The increasing importance of upskilling and re-skilling in the modern workplace

A recent World Economic Forum (WEF) report highlighted that over 85 million jobs are expected to be displaced by 2025 as a result of automation (and broader digital transformation projects). The report found that the most competitive businesses will be those that choose to reskill and upskill employees whose roles are disrupted by automation.

The report highlighted that:

• On average, companies estimate around 40% of workers will require reskilling of six months or less
• 94% of business leaders expect employees to pick up new skills on the job (a sharp uptake from 65% in 2018)

Similarly, a recent Workplace Learning survey conducted by LinkedIn provided a highly insightful snapshot of how the pandemic has not only cemented Learning & Development’s seat at the C-Suite table, but also increased the importance of continuous learning; in particular, reskilling and upskilling.

L&D was found to play a crucial role in identifying skills gaps (39%), building internal mobility tools (33%), and identify skills adjacencies (31%).  

However, the survey showed that reskilling and upskilling programmes appear to still be relatively new for most talent teams, finding that:

• 49% of L&D professionals are working with people managers to drive learner engagement and skills building
• Only 40% of learners said their managers are challenging them to learn a new skill
• Just 53% reported that their boss supports their career goals

So what do stats like these, coupled with L&D’s increased capacity to influence, mean for your L&D initiatives in 2022 and beyond?

Understanding the bigger picture

Before we look at the solution, it’s important to first consider other factors that are influencing this shift. In particular, the modernisation of performance management techniques and how employee attitudes regarding skills training are changing.

The shift towards continuous performance management

The emergence of a more continuous performance management process highlights the importance of supporting managers’ skills development. This is especially true for skills such as coaching, mentoring, wellbeing, and digital communication for managers at all levels. These skills are taking on even greater importance thanks to the rapid growth in dispersed teams and remote/hybrid workforces.

In particular, there’s a need to upskill managers to enable them to have higher-quality, more meaningful career conversations with their direct reports. This appears to be something managers are already conscious of and seeking to respond to. The aforementioned LinkedIn survey revealed that managers are spending almost 25% more time learning soft skills than the average learner.

The impact of Gen Z entering the workforce

While managers are prioritising soft skills, younger generations, and Gen Z in particular, are spending their time improving their productivity, business and technology basics. This is, however, not that surprising considering that managers are historically more likely to have been promoted as a result of their hard skills, and therefore feel there’s less need to focus on developing these skills further.

Less surprising, however, is that with their laser focus on career growth, 76% of Gen Z learners believe that “learning is the key to a successful career,” the LinkedIn survey revealed. They are far more likely to take ownership of their development, seeking out opportunities for growth and development wherever possible. This included being far more likely to explore topics that they are ‘curious about’, and not just those related to improving performance.

Considering that the Millennial generation before them are stereotypically concerned with doing ‘meaningful’ jobs and working at companies that align with their own personal values and beliefs, this shouldn’t come as a great surprise.

Getting the balance right between older generations, whose roles are more likely to be displaced due to digital disruption, and the younger generations for whom the ‘job for life’ concept is entirely alien, is a challenge that a well-designed upskilling and reskilling programme must overcome.

Reskilling to support internal mobility and career progression

Another fact that’s perhaps not entirely surprising is that the number of internal hires grew during the pandemic. Since the COVID-19 outbreak, internal hires make up 19.6% of all hires (an increase of almost 20% on 2019). Staying with an existing company is likely seen as less of a risk than moving to a new one in uncertain times.

However, with 51% of L&D professionals globally reporting that internal mobility is even more of a priority since the pandemic, the role that upskilling and reskilling programmes play in broader business success will only grow.

The benefits of internal mobility programmes are easily identifiable

Employees at companies with high internal mobility stay almost twice as long (5.4 years) than those that lack internal mobility (2.9 years). Measuring the ROI of internal mobility programmes is therefore fairly easy – the reduction in annual staff turnover alone greatly reduces the costs of rehiring and training new employees.

Furthermore, Glint data cited in the LinkedIn report shows employees that move to new internal roles are 3.5 times more likely to be engaged than those who haven’t. This suggests that there are additional benefits gained by supporting internal mobility, including improved motivation and performance.

But successful upskilling programmes aren’t just about helping more junior team members advance their careers and explore new opportunities. The key to the success of these programmes may lie in ensuring managers are suitably skilled to support them and get the most out of increasingly mobile employees.

Clearly defined learning pathways help people focus on what’s most important out of all the options available to them. Pre-defined pathways help reduce decision fatigue and provide assurances that time spent on learning certain skills will support their career aspirations.

But as we’ve seen with younger generations, only by offering a blend of pre-defined learning pathways with opportunities for more self-directed learning will ensure that employees of all generations feel supported in their career aspirations. With such support, they are inclined to stick with their current employer rather than seeking opportunities elsewhere.

Employee engagement is key to long-term reskilling success

Going back to the data, the LinkedIn report echoes the findings of WEFs which stated that on average, employers expect to offer reskilling and upskilling to just over 70% of their employees by 2025 (with 66% expecting to see a return on this investment within one year).

Interestingly it also highlighted that employee engagement may be lacking, with only 42% of employees taking up these employer-supported reskilling and upskilling opportunities.

This underlines just how important it is to ensure that employees understand the opportunities available to them and that they are motivated to take them up. This is where formal internal mobility programmes come to the fore.

Additional WEF data highlights the growth of employees moving into ‘emerging roles’ from entirely different occupations – some of which don’t even share the same skills requirements. And by 2025, it’s expected that analytical thinking, creativity and flexibility will be among the most in-demand skills needed to fill these emerging roles – skills that aren’t commonly included in skills training programmes at present.

Hire for attitude, train for skills

Findings from a recent Debut study suggest that when hiring, employers are increasingly conscious of the importance a candidate’s soft skills, such as communication, management and organisation skills. The same study highlights that employers are increasingly looking for candidates with hard skills – especially those which are transferable across industries.

So while the old adage that you should ‘hire for attitude and train for skills’ still rings true, people with a good mix of both soft and hard skills are increasingly prized, and if internal opportunities aren’t made available, you can expect they will seek opportunities elsewhere.

Providing employees with opportunities to move into roles that aren’t considered naturally ‘adjacent’ will be critical, given the acceleration of technological change and the increasingly pressing need to retrain and redeploy talent for the new world of work, as the WEF prediction tells us.

Strategic initiatives go beyond “plugging the skills gap”

The ability to attract and retain the best talent is becoming a greater competitive advantage than ever before – especially as the global talent pool opens up with remote working becoming more common.

If your digital transformation programme doesn’t include a shift towards modern performance management and skills training, you might not only start losing your talent to your competitors, but also find it harder to hire their replacements too.

But by being proactive around your talent management and utilising internal mobility programmes, you’ll be able to focus less on ‘plugging skills gaps’, and more on developing an agile workforce that grows together for years to come.

To discover more download our HR Transformation Playbook.